John Frank, Equity Product Strategist for PowerShares by Invesco, recently spoke with Julie Cooling, CEO and Founder of RIA Channel, about 2017’s strong growth, the components of the QQQs, and what 2018 has in store for investors.
Frank noted that the success of 2017 was “a story of fundamentals.” He cited strong earnings from large companies as the chief driver of a year that returned 33% for the QQQs.
While some investors think of the QQQs as a technology index, Frank says that isn’t the entire story. Forty percent of the fund is made up of companies outside of the technology space, who use technology as a differentiator. Frank cites Amazon and Tesla as prime examples of consumer companies in the QQQs that leverage technology. In addition, companies that can use artificial intelligence to predict customer behavior stand to make a significant impact on the QQQs.
Frank also touched on what 2018 has in store for investors, including the potential benefits tax reform may have on the QQQ ETF.